The information that follows relates to equipment owned by Buffalo Limited at December 31, 2023: Cost Accumulated depreciation to date Expected future net cash flows (undiscounted) Expected future net cash flows (discounted, value in use) Fair value Costs to sell (costs of disposal) (a1-a3) At December 31, 2023, Buffalo discontinues use of the equipment and intends to dispose of it in the coming year by selling it to a competitor. It is expected that the costs of disposal will total $54,000. 1. 2. Assume that Buffalo is a private company that follows ASPE. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) 3. No. Account Titles and Explanation (1) $9,720,000 (2) 1,080,000 (3) 7,560,000 6,858,000 6,696,000 54,000 Prepare the journal entry at December 31, 2023, to record asset impairment, if any. Prepare the journal entry to record depreciation expense for 2024. Assume that the asset was not sold by December 31, 2024. The equipment's fair value (and recoverable amount) on this date is $7.02 million. Prepare the journal entry, if any, to record the increase in fair value. It is expected that the costs of disposal will total $54,000. Debit Credit THE
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LIST OF ACCOUNTS:
Accumulated Depletion
Accumulated Depreciation - Buildings
Accumulated Depreciation - Equipment
Accumulated Depreciation - Furniture and Fixtures
Accumulated Depreciation - Machinery
Accumulated Depreciation - Vehicles
Accumulated Impairment Losses - Building
Accumulated Impairment Losses - Equipment
Accumulated Impairment Losses - Land
Accumulated Impairment Losses - Machinery
Accumulated Impairment Losses - Mine
Accumulated Impairment Losses - Patents
Accumulated Impairment Losses - Tools and Dies
Accumulated Impairment Losses - Vehicles
Asset Retirement Obligation
Buildings
Cash
Common Shares
Contribution Expense
Cost of Goods Sold
Deferred Revenue - Government Grants
Depreciation Expense
Equipment
Furniture and Fixtures
Gain on Disposal of Automobiles
Gain on Disposal of Building
Gain on Disposal of Equipment
Gain on Disposal of Furniture and Fixtures
Gain on Disposal of Machinery
Gain on Disposal of Vehicles
Gain on Sale of Land
Interest Expense
Interest Pavable
Inventory
Investment Property
Land
Liability for Site Restoration
Loss on Disposal of Automobiles
Loss on Disposal of Building
Loss on Disposal of Equipment
Loss on Disposal of Machinery
Loss on Disposal of Vehicles
Loss on Expropriation
Loss on Impairment
Loss on Sale of Land
Machinery
Mineral Resources
No Entry
Notes Payable
Oil Property
Recovery of Loss from Impairment
Repairs and Maintenance Expense
Revaluation Surplus (OCI)
Revenue - Government Grants
Royalty Expense
Vehicles
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